The Australian Accounting Standards Board recently issued an agenda decision on the assessment of materiality of key management personnel (KMP) related party transactions of not-for-profit public sector entities.
AASB 2015-6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities extends the scope of related party disclosures to include not-for-profit public sector entities for 30 June 2017 financial statements. Concerns were raised with the AASB about how AASB 124 Related Party Disclosures would operate for the public sector.
The AASB decided not to add the issues raised to its agenda because it noted that:
Please refer to the agenda decision for further guidance on the rationale for determining which related party transactions of not-for-profit public sector entities would be material.
The agenda decision is in response to concerns raised about how to apply materiality to these transactions.